Attorney Grievance Commission v. Willemain

SMITH, Judge. This is the second trip to this Court of this attorney where alcohol is said to be responsible for his violation of the Disciplinary Rules. See Attorney Griev. Comm’n v. Willemain, 297 Md. 386 , 466 A.2d 1271 (1983), for the earlier occasion.

We shall indefinitely suspend with the right to apply for readmission after two years subject to certain conditions. Bar Counsel, acting pursuant to the provisions of Maryland Rule BV9, filed a petition with us on behalf of the Attorney Grievance Commission seeking disciplinary action against David Grant Willemain, a member of the Maryland ⁶⁶⁸ Bar since June 20, 1974. The petition alleged violation of Disciplinary Rules 1-102(A)(1), (3), (4), (5), and (6); 2-110(B)(3); 6-101(A)(l), and (2); 7-101(A)(l), (2), and (3); 7-102(A)(3), (5), and (8); and 9-102(A)(l), and (2), (B)(1), (2), (3), and (4). 1 Bar Counsel also charged a violation of ⁶⁶⁹ Maryland Code (1957, 1981 Repl. Vol., 1982 Cum.

Supp.) Art. 10, § 44. 2 ⁶⁷⁰ I Pursuant to Rule BV9 b we referred the matter for hearing to a judge of the Third Judicial Circuit of Maryland. He has filed a comprehensive report with us in which he states: “Based upon the testimony and exhibits adduced at the hearing, this Court is persuaded by clear and convincing evidence that the following facts are true. “During July, 1980, Willemain began representing Ales M. Culotta concerning the domestic problems with her husband, Anthony C. Culotta. As of 1982, Mr. and Mrs. Culotta, who were then still married but separated, owned a home as tenants by the entireties known as 8201 Bellona Avenue, Towson, Maryland, subject to a first mortgage held by Bradford Federal Savings and Loan Association and a second mortgage held by Control Data Business Systems. Mr. and Mrs. Culotta were behind in their mortgage payments to Bradford Federal and by June, 1982, foreclosure on the property by Bradford Federal was imminent. ⁶⁷¹ “On or about July 8, 1982, Willemain prepared a contract of sale for the home which was executed at that time between Mr. and Mrs. Culotta as sellers and Scott Haupt, Robert Pollock and Michelle Pollock, his wife, as purchasers.

The execution of this contract averted the foreclosure. The contract price was $92,000.00. “Pursuant to the terms of the contract, the purchasers paid two deposits to Willemain as escrow agent, both of which were credited against the purchase price. The first deposit, in the amount of $3,350.30, was paid to Willemain at the time of the execution of the contract. The second deposit, in the amount of $4,600.00, was paid to him on July 30, 1982. “Under the terms of the contract, Willemain, as escrow agent, was required to place these two deposits into an escrow account and from the second deposit ($4,600.00) pay the monthly payments on the first mortgage ($506.82) and second mortgage ($385.19) until settlement, which ultimately occurred on December 31, 1982 at Sentinel Title Corporation.

Taking into account the two deposits mentioned above, the settlement officer issued a check for the net proceeds of sale to Mr. and Mrs. Culotta in the amount of $19,365.99, which was deposited in Willemain’s escrow account on January 3, 1983. On June 2, 1983, Willemain drew a check to the order of Mr. Culotta and Robert B. Greenwalt, Esquire (Mr. Culotta’s attorney) in the amount of $10,198.98 for Mr. Culotta’s share of the net proceeds. The balance in the escrow account, however, was under $6,000.00 between June 1, 1983 and June 10, 1983 when a deposit of $5,500.00 raised the balance to $10,598.13. Willemain’s check to Culotta and Greenwalt cleared on June 13, 1983. “All of the above facts were presented to this Court through PX1 and are uncontraverted.

Willemain concedes that he made only four payments each to Bradford Federal and Control Data out of the $4,600.00 fund which he held and made no payments after September 29, 1982 (PX2E). Had Willemain made the mortgage payments as ⁶⁷² he was required to do under the terms of the Culotta/Pollock Agreement (PX2A) he should have had a remaining balance in his escrow account of $1,031.96 ($4,600.00 less $385.19 + $506.82 x 4). His bank records, however, show clearly that on November 29, 1982, approximately one month before settlement, his escrow account showed a balance of $27.69. “Willemain further concedes that when he was called upon to disburse the $19,365.99 fund which he held in escrow following the December 31, 1982 settlement of the sale of the Culotta’s property, he did not have sufficient funds in his escrow account to cover a check written to Anthony Culotta on June 2, 1983 in the amount of $10,-198.98 (PX3 — Tr. 36). Between the issuance of that check and its presentation for payment, Willemain made a deposit of $5,500.00 of his own funds on June 10, 1983 (PX5) to cover the Culotta payment. “All of the above facts were presented to this Court by the Commission by way of exhibits and without testimony and the Commission rested its case. “Willemain’s defense to the Commission’s charges consisted primarily of a re-presentation of his continuing struggle with alcoholism and substance abuse, factually consistent with that considered in Attorney Grievance Commission v. Willemain [ 297 Md. 386 , 466 A.2d 1271 ], Misc.

Docket No. 29, September Term 1982, filed October 25, 1983, reported 297 Md. 386 . (The opinion in that case was offered and received as Defendant’s Exhibit #3 in this proceeding.) Willemain presented evidence of compliance with the Court of Appeals condition number 3 for reinstatement, namely: ‘He shall be associated with another member of the Bar of this Court who shall monitor his activities as a practicing lawyer and report promptly to Bar Counsel should Willemain fail to act promptly on behalf of his clients. That attorney’s consent and an indication of his willingness to so act shall be appended to any petition for reinstatement.’ ⁶⁷³ “Unfortunately for Willemain, his associate and monitor has had little experience as a member of the Bar, having been admitted in 1981, has served as monitor only since January, 1985 and has reported to Bar Counsel on two occasions (April 26, 1985 and August 15, 1985): T confess that I am somewhat uncomfortable in this role. It is my desire to satisfy you and the Court in every respect.

I am uncertain as to precisely what is expected of me and would appreciate your advices as to how to carry through with my responsibility.’ and T must call to your attention that I am incompetent to review Mr. Willemain’s bankruptcy and tax files. I have no training, education or experience in these areas. I must also tell you that my work and expertise in real estate is limited.’ “Further, the monitor testified to an inability to balance checkbooks, but that Willemain’s escrow account ‘looks right’. “In any event, the monitor could have been of no help to Willemain in this case, having been only recently designated as monitor, long after the events which led to the charges under consideration here. The remainder of Willemain’s defense consisted of the testimony of the Director of the MSBA Lawyer Counseling Service, physicians, the Respondent’s wife and the Respondent himself, who have persuaded this Court by clear and convincing evidence that the Respondent is a recovering alcoholic and substance abuser who has made major adjustments in his life style since 1982 and significant strides toward reorganizing his law practice.

Moreover, the events which led to the instant charges occurred prior to the institution of the charges which resulted in the Disciplinary Orders imposed by the Court of Appeals in Attorney Grievance Commission v. Willemain, supra in October, 1983. This Court finds as a fact that the events involving the Culottas are nothing more than another chapter in the ⁶⁷⁴ continuing saga of a lawyer’s misconduct which was, in the words of the Court of Appeals, ‘triggered by his bout with the bottle’ ( Willemain, supra). While there was some evidence that Willemain also suffers from a personality disorder, this Court is unable to find a causal connection between that diagnosis and Willemain’s professional misconduct. “CONCLUSIONS OF LAW “Based upon the aforegoing findings of fact this Court concludes, as a matter of law, Willemain did violate: “1. Disciplinary Rule 1-102(A)(1), (4) and (6) in that he used funds of a client held in escrow for purposes other than those for which he held such funds and knowingly wrote checks on that escrow account which exceeded the available balance of the escrow account. “2.

DR 2-110(B)(3) in that his alcoholism and substance abuse rendered it unreasonably difficult for him to effectively carry out his employment by Mrs. Culotta to handle the escrow funds entrusted to him. “3. DR 7-102(A)(3), (5) and (8) in that he knowingly concealed the use of escrow funds for purposes other than those for which the funds were entrusted to him, knowingly made a false statement of fact by issuing a check to Mr. Culotta on an account, which check exceeded the balance of such account, and knowingly engaged in illegal conduct by using a client’s funds held in escrow. “4. DR 9-102(B)(3) and (4) in that he failed to maintain complete records of all funds of a client coming into his possession and promptly pay or deliver to the client the funds in his possession or pay the funds to others who were entitled to receive them.” II Bar Counsel has excepted to certain of the trial judge’s findings of fact. ⁶⁷⁵ a He first excepts to the finding to the effect that the events which led to the instant charges occurred prior to the institution of the charges which were before the Court in the prior proceeding to which we have referred. The prior case was instituted by the filing of a petition for disciplinary action with us on January 3, 1983.

The report of the trial judge was dated May 12, 1983. It will be recalled that the trial judge in his report in this case referred to the settlement from which the bulk of the funds were misappropriated as having taken place on December 31, 1982. We sustain this exception. b Bar Counsel excepts to the failure of the trial judge to conclude that Willemain violated Art. 10, § 44, “particularly in view of his conclusions numbered 1 and 3____” It is obvious that when the escrow funds were not in the trust account of Willemain there was a violation of this statute. Hence, we sustain this exception. c Bar Counsel excepts to the failure of the trial judge to conclude that Willemain violated DR 1-102(A)(3) “in view of his conclusions numbered 1 and 3.” This rule pertains to engaging in illegal conduct involving moral turpitude.

Misappropriation of the funds of others by an attorney is such conduct. Therefore, we sustain this exception. Ill Willemain has filed a number of exceptions. a He first excepts to the finding that his monitor has reported on only two occasions, saying that in fact three reports were made although the letter constituting a third report was not offered in evidence. Bar Counsel concurs.

Therefore, that exception is sustained. ⁶⁷⁶ b Willemain excepts to the conclusion that he violated any of the canons cited “to the extent that they require intent and volition.” In his testimony Willemain characterized his use of the escrow funds as a borrowing of funds. Borrowing obviously is a volitional act. In Attorney Griev. Comm’n v. Pattison, 292 Md. 599 , 441 A.2d 328 (1982), we spoke of the temptation of attorneys to “borrow” the funds of clients: “So often attorneys for one reason or another find themselves in a position where the flow of cash in their practice is insufficient to meet office overhead, family needs, and the like.

Then comes the temptation to dip into funds which have been entrusted, to the attorney, with the thought that the money soon can and will be paid back and the hope that no one will be the wiser. Often, as here, the peculations grow and grow. It is fundamental that a fiduciary may not make a loan, secured or unsecured (as was this), unto himself.” 292 Md. at 607-08 , 441 A.2d at 332 . The record in this case supports the trial judge’s finding of knowing violations of the Disciplinary Rules.

Accordingly, this exception is overruled. c Willemain excepts to the conclusion that he violated DR 1-102(A)(4) pertaining to engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation “because he did not intend to defraud or deceive.” For the reasons stated in b above this exception is overruled. d Willemain excepts to the conclusion that he violated DR 2-110(B)(3) pertaining to withdrawal from employment where one’s mental or physical condition renders it unreasonably difficult for him to carry out the employment effectively. He says, “[Tjhere was ho evidence that he failed to carry out his employment effectively or to repre ⁶⁷⁷ sent his client, Mrs. Culotta, properly. Moreover, there was no evidence concerning any alleged mishandling of her portion of the escrow funds.” Without going into an analysis pertaining to the situation in June of 1983 we point out that the trial judge found that on November 29, 1982, approximately one month before the settlement on the Culotta property, “his escrow account showed a balance of $27.69” when “he should have had a remaining balance in his escrow account of $1,031.96” had he made the required mortgage payments. A part of those funds belonged to Mrs. Culotta.

We overrule this exception. e Willemain excepts to the conclusion that he violated DR 7-102(A)(3) pertaining to concealing or knowingly failing to disclose that which he is required by law to reveal, saying “he did not conceal or fail to disclose something required by law to be revealed.” Bar Counsel states “that the unauthorized borrowing of funds of others from the escrow account and unauthorized use thereof would certainly be a violation of DR 7-102(A)(3) as it is illegal to use the funds of others without their permission.” This conduct involves essentially the same conduct discussed in III b and c. Hence, we shall